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Commissioner of Customs, Danville Walker, says it will cost in excess of $3 billion per annum to adequately finance the activities of the Customs Department, after the agency transitions to an Executive Agency (EA) over the next 18 to 24 months.

Speaking at a Customs Brokers and Freight Forwarders Association of Jamaica (CBFFAJ) forum at the Four Seasons Hotel in St. Andrew, on March 16, Mr. Walker said this figure is based on the modernisation plans being undertaken in the process, inclusive of the complement of staff to be recruited, and the “true cost” for the agency to deliver services to its clients.

Noting that the agency was allocated some $2.3 billion from the Budget to finance its operation during the 2010/11 fiscal year, the Commissioner stressed that, “for us to be properly funded and to move forward, you are looking at an annual cost of probably about $3.2 billion to $3.3 billion a year”.

Mr. Walker informed that the agency is developing a medium term plan for submission to the Public Sector Modernisation Unit, outlining how its budget could be financed. This, he pointed out, incorporates a review of the range of customs user fees (CUFs) charged for service delivery.    

Noting that CUFs yield approximately $7 billion in revenue annually, the Commissioner pointed to charges within the structure, which need to be revised under the EA model. This would reflect the “true cost” of the Customs Department’s services, he said.

“We will discuss what that number needs to be, because I’m sure the Jamaica Manufacturers’ Association (JMA) and the Private Sector Organization of Jamaica (PSOJ), will have their suggestions as to what that amount should be. It is my view that those costs cannot be just added on to the CUF…the market out there wouldn’t bear that. What we have to do is look through the gamut of fees, and make those that are now obsolete, current,” Mr. Walker said.

“The true cost has to be allocated, and that would have to be an adjustment within the CUF, in my view. But the principle is that the true economic cost of delivering the services will have to be borne (by the importers),” he added.

Meanwhile, responding to queries regarding possible CBFFAJ representation on the Customs Department’s Board after its transformation to an Executive Agency,

Mr. Walker said while this is yet to be determined, “it’s what I would push for”.

“The brokers, to me, are our main stakeholders, and I see them as partners. So, I would expect to have brokers on the Board of the Executive Agency,” Mr. Walker said.

 

By DOUGLAS McINTOSH, JIS Reporter